Imagine this, you meet someone you mesh with and you want to start building a life together. The only problem is you might be too punch-drunk with excitement to give much thought to how your partner will handle shared expenses.
According to a new AICPA survey, 88% of Millennial couples say financial decisions are a source of tension in their partnerships. Half say that money matters come between them on a weekly or daily basis. The survey found that nearly half (47%) of Millennial couples have never talked about their individual saving and spending habits.
Apparently, one reason that money may cause friction for young couples is that not enough of them discuss the role it plays in their relationship. But couples who do prioritize financial conversation say that it makes their bond tighter and happier.
Here, four women talk about how they and their partners tackled the subject and arrived at the money style that works for them.
“We Keep Most of Our Money Separate”
Sarah Murray (27) and Devin McNeal (29)
Relationship Status: Dating for 3 years
Occupations: Sarah is a Mental Health Professional, Devin is a Sales Representative
Our money life: When Devin and I met three years ago, we knew quickly that our relationship was something special. After about a year of dating and a move from Indiana to Texas, we took the step of opening a joint savings account on top of our individual savings and checking accounts and started combining expenses.
We agreed to put $25 each per month into the joint account, solely for future vacation plans or emergencies. We always split our rent, however some months I or Devin will pay more than half, giving the other person a few hundred dollars’ break.
For groceries, laundry and minor fun activities we trade off weekly. Some months I pick up more of these joint expenses; other times Cody does.
We pay our own debts separately, so I’m only in charge of my student loans, car insurance, credit card, health insurance (I own my own business) and business expenses. Although he makes more than I do, I have been able to save more total due to less debt and fewer student loans.
How often we talk finance: At least a few times every month.
Challenges: We plan to rent for the immediate future. But we do talk about buying property, although because of his student loans, it’s a little difficult. We’re going to revisit the idea of purchasing a home together in the next three to five years depending on where we’re at with finances.
Why it works for us: It comes down to great communication. We strive for goals individually and as a couple, and we really cheer each other on. We also don’t keep tabs of who’s paid more for certain things because that’s a recipe for arguments.
“We Live on One Income”
Sonia Sanchez (38) and Ricardo Sanchez (39)
Status: Married for 12 years
Occupations: Sonia is a stay-at-home mom and Ricardo is an attorney
Our money life: Ricardo and I were friends before we began dating, and as we got more serious I told him early on that I wanted to stay home once I had children. When our first kid was born almost 10 years ago, we were lucky that we had the finances to live solely on Ricardo’s income.
I still maintain a few investments in my name that I had before I married. But everything else we share. We have a couple of joint checking and joint savings accounts; out of this we pay household bills, car expenses, babysitting and other kid costs. My husband contributes to a retirement account through his employer, and we own our own home in the suburbs.
Ricardo took a 15% pay cut several years ago in exchange for a more relaxed work schedule. That forced us to take a closer look at our spending. In addition to cutting back on takeout and grocery delivery, I sewed the bedding for our children’s rooms and my husband built our kitchen table and the kids’ beds. Between the stuff we built ourselves and home repairs we take on, we’ve saved thousands of dollars.
How often we talk finance: We only discuss finances when the need arises, say because we are sorting things out or making plans.
Challenges: Sometimes I feel guilty about buying things for myself, like a new purse. It’s a point of frustration for us because my husband truly doesn’t care — he wants me to be able to get the things I want and need. But because I don’t work, I think, ‘OK, I can only buy clothes from Old Navy.’
Why it works for us: We had similar upbringings; our parents didn’t go around spending a lot of money. Also, we talk about everything, and we don’t keep secrets. I think things would be very different if I had a husband who resented my not having a salary or if I frivolously spent a lot of money.
“I’m the Main Breadwinner So I Pay More”
Nicole Washington (30) and Craig Washington, 33
Status: Married 2 years (together 8 years)
Occupations: Nicole is a life coach and Craig is a policy researcher
Our money life: We both contribute equally to the main expenses of our rental house, but because I am the breadwinner and my salary accounts for about 70% of our total income, I tend to put in more toward savings and expenses like insurance, car payments, travel and dining out.
We maintain a couple of joint accounts for emergencies and for different goals, like buying a house. To save for our first home, we’ve decided to budget for things like dining out and traveling, and we postponed buying a new car for a year to put more toward a down payment.
We keep a budget spreadsheet on our shared Google Drive. When we want to save for something, we’ll literally break out a calculator and say, ‘based on what we want to save by this date, here’s how it breaks down in terms of monthly contributions.’ Then I’ll put a little more money in than Roger every month, as we work toward that goal.
How often we talk finance: We don’t have a schedule. We like to talk when questions come up, or we will set aside time on weekends if it’s a major issue, like saving for something big.
Challenges: One argument we had concerned the money I was spending. So, we opened up our books, and each showed the other how we were allocating the income we made individually. Roger was able to see that I had a certain bucket of money that I could spend on nice shoes, for example, or a massage. As long as we focus on the most important things we want to accomplish — saving for the house, the car, the vacation — he’s OK with my keeping more discretionary income to myself.
Why it works for us: It hasn’t always been harmonious. Although we met when we were in grad school and broke, we took different approaches to the little we did have: I would just wing it without a budget, whereas he would save up money. Now, as long as we’re each allocating money for the big things, the rest falls into place. Keeping records and tabs on our spending also helps us avoid arguments.
“We Split Household and Vacation Expenses”
Tiffany Rodriguez (27) and Philip Edwards (32)
Status: Dating for 2 years
Occupations: Both are full-time personal fitness trainers
Our money life: We’ve been together for more than two years and just bought our first house seven months ago. As far as most household bills and our mortgage, everything is broken down the middle; we even split our down payment. We each have our own independent checking and savings accounts, but a joint vacation account.
Philip is an active and aggressive trader and investor in financial markets, which makes his income greater than mine. His spending style is usually put toward an investment that will yield a monetary return. For the most part, he is also a diligent saver. Because he makes more, he will sometimes spend more on appliances and home maintenance than I do. And when we go out, he willingly covers any dining-related activity. He’s a traditional gentleman that way.
We began talking about finances during one of our first interactions together, and since then we haven’t had much disagreement. I’ve always been very frugal with my money and only spend it on necessities. Thanks to Philip, I’m learning more about investments and planning to get involved in them myself.
How often we talk finance: Almost daily. We also have discussions at least once a week about how we are going to increase our income and decrease our expenses and our debt-to-income-ratio.
Challenges: Sometimes I had moments where I wanted a nice purse or to go on a shopping spree. I never was going to back out of saving; these were just thoughts.
Why it works for us: I truly believe transparency and honesty as well as open lines of communication are vital to work through any challenges, financial or anything else. I think one of the reasons relationships fail is because they can’t handle conversations about money. Instead, people wait until after marriage to bring it up and by then it’s already a conflict. Teamwork makes the dream work.